Supply chain loss from easing COVID-19 restrictions: an evolutionary epidemiological-economic modeling study (preprint)

ABSTRACT

Since the start of the COVID-19 pandemic, many firms have been shifting their supply chains away from countries with stringent control measures to mitigate supply chain disruption. Nowadays, the global economy is reopening from the COVID-19 pandemic at various paces in different countries. Understanding how the global supply network evolves during and after the pandemic is necessary for determining the timing of reopening. By harnessing the real-world and real-time global human movement and the latest macroeconomic data, we propose an evolutionary epidemiological-economic model to explore the evolutionary dynamics of the global supply network under various global reopening scenarios. We find that the delay in full reopening in highly restrictive countries has limited public health benefits in the long run but leads to significant supply chain loss to less restrictive ones. Longer duration of stringent control measures leads to lower supply chain recovery in five years. The recovery rate varies across production sectors, depending on the characteristics of production, the degree of self-reliance, and the location of production hubs. This research presents the first data-driven evidence of supply chain loss due to the timing of reopening and sheds light on the post-pandemic supply chain reformation and recovery. Our results provide data-driven evidence that supports the reopening in countries with high vaccine coverage.